Background: Lymphocyte activation gene-3 (LAG-3) inhibits T cell activation and interferes with the immune response by binding to MHC-II. As antigen presentation is central in rheumatoid arthritis (RA) pathogenesis, we studied aspects of LAG-3 as a serological marker and mediator in the pathogenesis of RA. Since Galectin-3 (Gal-3) is described as an additional binding partner for LAG-3, we also aimed to study the functional importance of this interaction. Methods: Plasma levels of soluble (s) LAG-3 were measured in early RA patients (eRA, n = 99) at baseline and after 12 months on a treat-to-target protocol, in self-reportedly healthy controls (HC, n = 32), and in paired plasma and synovial fluid (SF) from chronic RA patients (cRA, n = 38). Peripheral blood mononuclear cells (PBMCs) and synovial fluid mononuclear cells (SFMCs) were examined for LAG-3 expression by flow cytometry. The binding and functional outcomes of LAG-3 and Gal-3 interaction were assessed with surface plasmon resonance (SPR) and in cell cultures using rh-LAG3, an antagonistic LAG-3 antibody and a Gal-3 inhibitor. Results: Baseline sLAG-3 in the plasma was increased in eRA compared to HC and remained significantly elevated throughout 12 months of treatment. A high level of sLAG-3 at baseline was associated with the presence of IgM-RF and anti-CCP as well as radiographic progression. In cRA, sLAG-3 was significantly increased in SF compared with plasma, and LAG-3 was primarily expressed by activated T cells in SFMCs compared to PBMCs. Adding recombinant human LAG-3 to RA cell cultures resulted in decreased cytokine secretion, whereas blocking LAG-3 with an antagonistic antibody resulted in increased cytokine secretion. By SPR, we found a dose-dependent binding between LAG-3 and Gal-3. However, inhibiting Gal-3 in cultures did not further change cytokine production. Conclusions: sLAG-3 in the plasma and synovial fluid is increased in both early and chronic RA patients, particularly in the inflamed joint. High levels of sLAG-3 are associated with autoantibody seropositivity and radiographic progression in eRA, and LAG-3 plays a biologically active role in cRA by decreasing inflammatory cytokine production. This functional outcome is not affected by Gal-3 interference. Our results suggest that LAG-3 is a faceted regulator of inflammation in early and chronic RA.